Afridi & Angell inBrief
Lifting of US Sanctions
The US Government announced the removal of Sudan from the US list of state sponsors of terrorism effective as of Monday 14 December 2020.
After 27 years of US sanctions, such step restores sovereign immunity for the Sudanese government in US Courts. It is also a critical step in the process of reintegrating Sudan into the global economy and offering a lifeline of international financial aid to Sudan.
While the Obama administration took steps to lift sanctions, unfreeze assets and remove financial sanctions in January 2017, the recent declaration that Israel and Sudan intend to normalize relations has played a major role in Sudan’s delisting as a state sponsor of terrorism.
Sudan is one of the largest and most geographically diverse states in Africa, recently having been split into two countries (Sudan and South Sudan – July 2011) after the people of the south voted for independence. It borders Egypt, Libya, Chad, the Central African Republic, South Sudan, Ethiopia and Eritrea. Sudan is also a country of great economic potential: strategic location, gold reserves, oil and gas fields, mineral resources, a favourable climate, as well as excellent irrigation and soil conditions.
Sudan’s National Investment Encouragement Act (the “Act”) of 2013 promotes foreign direct investment and prohibits discrimination against foreigners in investments. The Act defines three types of investment projects: national, strategic and state. Sudan has put in place an open investment legislative framework with several laws and regulations that are modern and based on best practices. The Act also establishes the National Investment Council, chaired by the President of Sudan. The focus and objective
of this council is to facilitate investment in all sectors of the Sudanese economy. The Act allows foreign and domestic private entities to establish and own business enterprises and to repatriate capital and profits.
Given the recent removal of Sudan from the US list of state sponsors of terrorism and given the normalization of the ties between the US and Sudan, investment opportunities in Sudan have opened up. It has been reported that multinational US corporations have already signed MOUs to invest in Sudan. This is the beginning of a new era for Sudan and a promising time to invest. Early movers are likely to reap the benefits, provided investments are structured in a prudent manner. ■Download inBrief as PDF